Communities Secretary Greg Clark has approved the Birmingham Independent Improvement Panel’s proposal to stand down over the summer and give the city council space to step up the pace on implementing the Kerslake reforms.

Mr Clark told MPs in the House of Commons that he was “very happy” to accept the panel’s plan and he believed the council had made progress in “becoming more responsive”, but there were a number of challenges to overcome.

He paid tribute to the work of panel chair John Crabtree and the other members for their “sterling work” since January 2015.

I’d like to pay tribute to John Crabtree and his fellow panellists. I’m pleased to say Birmingham city council has made progress on the recommendations of the Kerslake Report. The panel has done sterling work in helping the council to become more responsive.

There remain a number of challenges that the council will have to overcome to transform its vision into reality.

The panel wrote to me today suggesting they step back until the autumn to report on how the council has progressed. I’m very happy to accept that recommendation and I wish them well for the months ahead.

Mr Mitchell said the Government had “quite rightly” been concerned with the structure and effectiveness of local government in Birmingham. He added: “This is not a party political point because those concerns have existed under both Labour and Conservative governments.”

Mr Mitchell said it was important for the Communities Secretary to give the council’s new Labour leader, John Clancy, the space to “implement the necessary reforms”.

In his letter Mr Crabtree says it is “regrettable” that the council has not progressed farther along the path to reform and that the impact of the Kerslake reforms “is less than was planned for”.

He adds that although the pace of progress has picked up, the changes have” not yet had the required impact, or become embedded”.

The panel says it wants to be certain the council can “deliver on its commitment to sweep away all residual, over-complex, old-fashioned, time-consuming and risk-averse processes that are continuing to stifle creativity and which sap the capacity and energy of managers and staff.”

The letter raises questions about the council’s commitment to partnership working, and points to the difficulty of delivering budget savings including £18 million through controversial changes to workforce contracts and £30 million through integrating council and NHS budgets.